A hydroxyapatite-gelatin nanocomposite system has been developed to resemble the composition and ultrastructure of natural bone for the application of tissue engineering. In the current study, variations in composition - content of gelatin and glutaraldehyde crosslinker - were examined in the context of mechanical properties and material biocompatibility. It was found that increasing the gelatin concentration resulted in a decreased hydroxyapatite crystal length and was associated with a slight increase in elastic modulus. Increases in gelatin and glutaraldehyde content were associated with increased material fracture toughness. Cellular biocompatibility tests, including cellular attachment and proliferation assays, were also used to assist in the process of optimizing gelatin and glutaraldohyde content. Optimized biomimetic nanocomposite materials for in vivo applications will likely be a compromise between the improved mechanical properties and decreased cytocompatibility associated with increased glutaraldehyde contents.